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Conrad, Montana: Housing Market Dynamics and Doubling Home Values
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
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Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Conrad, located in Montana, is a small community with a population that has fluctuated around 2,700 residents over the past decade. The city has experienced notable shifts in homeownership rates and housing costs, reflecting broader economic trends and local market dynamics. Homeownership rates in Conrad have shown considerable variation over the years. In 2013, 68% of residents owned their homes. This percentage peaked at 73% in 2017 and 2019, before declining to 65% by 2022. Concurrently, average home prices have demonstrated a steady upward trajectory. In 2013, the average home price was $100,378, which more than doubled to $222,171 by 2022. This substantial increase in home values, particularly the sharp rise from $183,755 in 2021 to $222,171 in 2022, may have contributed to the decline in homeownership rates as affordability became a growing concern for potential buyers.
The relationship between federal interest rates and homeownership rates in Conrad aligns with typical economic patterns. When interest rates were at historic lows between 2013 and 2016, hovering around 0.1%, homeownership rates remained relatively stable, ranging from 66% to 68%. As interest rates began to rise, reaching 1.83% in 2018, homeownership surprisingly increased to 71%. This could be attributed to residents rushing to purchase homes before rates climbed further. However, as rates continued to rise, reaching 1.68% in 2022, homeownership rates declined to 65%, suggesting that higher borrowing costs may have deterred some potential buyers.
Renter percentages in Conrad have inversely mirrored homeownership trends. The proportion of renters increased from 27% in 2019 to 35% in 2022. This shift coincided with a significant rise in average rent prices. In 2013, the average rent was $582 per month. By 2022, it had increased to $786, representing a 35% rise over nine years. The growth in rental prices accelerated notably between 2016 and 2018, jumping from $631 to $775, possibly reflecting increased demand for rental properties as home prices also surged during this period.
In 2023 and 2024, Conrad's housing market continued to evolve. Average home prices reached $234,428 in 2023 and further increased to $236,588 in 2024, showing a continued upward trend but at a slower pace compared to previous years. Concurrently, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, potentially impacting home affordability and buyer behavior.
Looking ahead, predictive models suggest that average home prices in Conrad may continue to rise, but at a more moderate pace. Over the next five years, home values could potentially increase by 15-20%, reaching around $280,000 by 2029. Average rent prices are also expected to climb, potentially reaching $900-$950 per month in the same timeframe, assuming current economic conditions and local market factors persist.
In summary, Conrad has experienced significant changes in its housing market over the past decade. The most striking trends include the substantial increase in average home prices, the recent decline in homeownership rates, and the steady rise in rental costs. These trends, influenced by factors such as federal interest rates and local economic conditions, have reshaped the city's housing landscape and will likely continue to impact residents' housing choices in the coming years.
